Action and reaction do not balance each other because they

Concept:

Newtons Third Law of Motion

• Every action has an equal and opposite reaction. Action and reaction forces act on different bodies. 

Explanation:

• Considering an example, A bullet is fired from a gun.
• The gun applies force to a bullet and the bullet applies force on the gun. 
• If we consider the gun as the only object, it gives recoil which is the reaction force applied by it on the bullet. 
• So action force is a force on bullet and reaction force is applied on the gun. 
• Both forces are not on the same object hence the action and reaction forces cannot balance each other. 

So, 'do not act on the same body.' is the correct option.